Adversity as Speed Bump

What makes a company turn to the latest flavor of management training? Why do chairmen and human resources directors--our bottom-line bosses--try out the newest technique to hit the bookstores and the television talk shows? What pushes them is rarely a major crisis. More often it’s a creeping sense of “we can do better, but how?” John Harriman, president of Advantage Memory Corp. in Irvine, and James Tracey, chief executive of Diversified Collection Services in San Leandro, talk about why they instituted adversity skills training this year at their companies and what they’ve seen since.

John Harriman views persuasion as a game, each “no” a layer to be peeled away until “yes” appears like a shiny prize.

“I’m into it for the art of the deal,” he says. “I like to get from a ‘no’ to a ‘yes’ regardless of the amount of money involved. I love to start at no, get five no’s and then a yes.”

That’s all well and good if you’re a solo operator. But Harriman is president of Advantage Memory Corp., an Irvine company that engineers and manufactures computer memory upgrades. He has a staff of 110, a sales force of 25, offices in Scotland and Mexico.

Some of his employees share their boss’ endurance--that peculiar survival instinct that allows people to pick themselves up when they’ve been knocked flat.

“There are a couple of people in my company,” Harriman says, “who are so buoyant. They just lost a major deal and they’re smiling. It’s a different attitude. People see it and say, ‘I wish I could be like that person--just blow it off and go on.”’

But mostly they don’t. That tool, that ability to step back, regroup and go on--quickly--was either lacking or simply had been ground out of much of his sales staff, he said.

That’s a problem in any field, but particularly one as competitive as Advantage Memory’s. The company buys D-RAM chips from manufacturers, designs circuit boards, solders the chips on the boards, repackages them and then sells them as a way to increase memory in computers.

Harriman’s firm has contracts with other companies that add value to the product and then resell it to such end users as the U.S. military, General Electric Co., and a number of automobile makers.

It’s a competitive field, a global one, and one that is extremely price-sensitive. Advantage Memory operates in a $5-billion niche--the third-party memory aftermarket--of the $40-billion D-RAM industry.

Harriman’s sales staff has been a loyal one, with an average company tenure of four years. But that’s only good up to a point. Experience is important, but fire sometimes is more so, he argues.

“My guys make a lot of money then park it on the side of the mountain. They say, ‘I’m doing fine. I’ve got disposable income,”’ Harriman says. “I was seeing people in the company make upward of $20,000 to $30,000 a month in commissions. Then they’d dropped down to making $10,000.”

What happened, he figured, was that “they’d forgotten what got them there. You’re pumped, you’re willing to try new things. Once you become a veteran, you get into a routine. I had to raise the bar.”

Harriman had read “The Adversity Quotient” and taken the allied training course on “turning obstacles into opportunities.” And he thought that the tools taught during the program would be valuable to his sales force, a cold-calling confederation that by definition faces daily rejection.

And in a bullpen environment like Advantage Memory’s, where 25 salespeople occupy low-walled cubicles in a 4,000-square-foot office--the loss of motivation can spread like the flu.

“Once you’re down,” Harriman says, “others come down. The easiest excuse is to lose a deal, pout about it and quit. . . . It’s one thing for me to go around and say, ‘Get on the phone more, expand your base.’ . . . They need the tools to recognize that adversity is not the end of the world, the end of the job, the loss of the family. It’s just a speed bump, not a mountain.”

So one Saturday in February Harriman gathered his sales force together for a day’s worth of adversity skills training. One employee’s experience sticks out in particular.

This salesman had great difficulty dealing with the frustration and rejection that go with any sales job. He’d lose a contract, hang up the phone, pound the desk and then start placing blame. The competition has better pricing. They’re flying their sales staff here or buying them this and that.

After learning techniques to handle the daily setbacks that come with any job--stepping back, assessing his own level of responsibility for the problem, creating a plan and starting over--this salesman showed at least some improvement in both attitude and productivity.

“He would pound the desk, ready to put a gun to his head,” Harriman says. “Now, I can see him breathe and say, ‘OK, I’m having an adversity attack.’ . . . [His performance] definitely peaked right after. It’s kind of down right now. I don’t know what contributed to that. But he’s got some good things working. I’ve got a lot of faith in him.”

If sales is an industry fraught with rejection and ripe for motivational training, just consider the collections business. You spend your days calling up people who cannot--or do not want to--pay their bills, who are angry or embarrassed or in terrible trouble.

Just how happy can they be to hear from you?

So it’s no surprise that James Tracey, chief executive of San Leandro-based collection service DCS Inc., places great stock in employee training, reads management books hot off the press and shares with his workers the best of the inspirational and training programs that come along.

“We did Zig Ziglar,” Tracey says. “We did ‘The Seven Habits of Highly Effective People’ by Stephen Covey . . . ‘The Leadership Secrets of Attila the Hun,’ ‘The One-Minute Manager.’ I go through a lot of these things.”

But training in adversity skills really hit home to Tracey, who employs 550 people in Northern and Central California and Oregon, and whose company dominates the business of collecting on bad debts for the government. DCS has the federal contract to collect on defaulted government-guaranteed student loans, does collections for the Treasury Department and reels in unpaid taxes for a number of states.

“I find adversity training to be beneficial in every aspect of the job: on the phone, dealing with defaulted borrowers, our sales staff trying to land new customers, customer relations, personnel, data processing,” Tracey says. “I find hardly anyone says ‘Thank you’ for a data-processing program someone writes. So learning to handle adversity is a real benefit.”

Tracey believed so strongly that he sent Gary Ware, the company’s human resources consultant, to a training program put on by Paul G. Stoltz, author of “Adversity Quotient: Turning Obstacles Into Opportunities.” When Ware returned, Tracey shut down each of his locations for a full day to train every single staff member.

The actual training--which took place over three days in early April--cost $60,000. “But it’s even worse than that,” Tracey says. “We produce $230,000 a day in net revenues. We gave that up as well. But you make it back. If you’re constantly training, it affects employees’ personal lives and business lives.”

It’s too soon to tell whether DCS will recoup its sizable investment, and Tracey contends that the results of most training programs are hard to measure in a tangible fashion. But he believes strongly that “all of these things help. It opens [worker’s] eyes, motivates. It all helps the bottom line, but I don’t know how you pin it down.”

One of the areas that adversity skills training helps most in is workplace change. Ron Moser, DCS’s vice president for sales and marketing, said that the company is in the middle of a yearlong effort to institute an ISO 9002 program.

*

The ISO 9000 series are voluntary certifications that show a standard of documenting production processes. They are promoted by the Geneva-based International Standards Organization, a nongovernmental, voluntary group that encourages international standards and cooperation on intellectual, scientific, technological and economic matters.

One of the goals of such an effort is to institute recognized quality-control standards. Every department at DCS will be creating its own new policies and standards--which include regular audits--so there is more buy-in than if such policies were simply hoisted on workers.

Still, it changes the way work is done, and that can be difficult. Moser has high hopes that the just-completed adversity training will smooth the ongoing ISO 9002 process.

“All through this adversity training, people were saying, ‘I’m going through change. This is adversity. How do I handle it?’ ” Moser recounted. “We’re handling it better.”